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Understanding SECR – The UK’s Streamlined Energy and Carbon Reporting

Learn what SECR means for U.S. companies with UK operations. Discover who’s affected, what to report, and how ESG tools can simplify SECR compliance.
Category
Blog
Last updated
June 23, 2025

In an era of growing global environmental regulation, compliance is no longer confined to domestic boundaries. The UK’s Streamlined Energy and Carbon Reporting (SECR) framework is a clear example of legislation designed with national goals, yet possessing international implications. While SECR is rooted in UK environmental law, it also impacts certain U.S.-based businesses — particularly those with operations, subsidiaries, or financial listings in the United Kingdom.

For American companies engaged in cross-border trade, managing UK-registered entities, or listed on UK exchanges, understanding SECR reporting is not just beneficial — it is essential. Non-compliance could lead to regulatory penalties, operational inefficiencies, and damage to reputation in a business environment that increasingly demands transparency around carbon emissions and energy usage.

This blog explores the purpose, scope, and implications of SECR, offering practical guidance to U.S. businesses on how to meet SECR requirements while strengthening their sustainability credentials.

What is the main goal of SECR?

Introduced by the UK government in April 2019, SECR was designed to streamline and simplify previous energy and carbon reporting mandates. It replaced the complex Carbon Reduction Commitment (CRC) Energy Efficiency Scheme and aligned reporting more closely with broader sustainability goals.

The main aim of SECR is to promote energy efficiency, reduce corporate emissions, and ensure that energy-related data is disclosed in a clear and consistent manner. By requiring companies to disclose energy usage and carbon emissions data, SECR helps organizations — and their stakeholders — better understand and manage their environmental impact.

SECR supports the UK’s legally binding target to reach net-zero greenhouse gas emissions by 2050. For businesses, this means a major step toward integrating environmental performance into corporate governance and decision-making.

Which companies are covered by SECR carbon reporting?

SECR applies to UK-registered companies, but U.S. firms may fall under its scope if they operate qualifying subsidiaries or maintain UK listings.

There are three main categories of companies that must comply with SECR:

  1. Quoted companies: These are companies listed on the main market of the London Stock Exchange, or on equivalent markets in the European Economic Area or U.S. stock exchanges. A U.S. company with a UK listing is directly subject to SECR requirements.
  2. Large unquoted companies: UK-incorporated companies that meet at least two of the following:
    • More than 250 employees
    • Annual turnover greater than £36 million
    • Balance sheet total exceeding £18 million
  3. Large limited liability partnerships (LLPs): LLPs meeting the same size criteria as above.

For U.S. businesses, SECR applies indirectly if they own or control a UK-incorporated subsidiary that qualifies as a large company or LLP. Though the parent company may not be directly liable, it will likely need to support SECR data collection, especially for total energy consumption, carbon dioxide equivalent (CO₂e) emissions, and energy efficiency measures.

Note that charitable companies that meet the size criteria must comply with SECR, even if their primary purpose is not commercial.

What was the timeline for implementation?

SECR has been in effect since April 1, 2019, and it applies to financial years starting on or after this date.

  • From April 2019, eligible organizations were required to start collecting SECR data.
  • First SECR disclosures were made in 2020, covering the 2019–2020 financial year.
  • SECR is now an annual reporting requirement and must be included in a company’s annual report or, for LLPs, in an energy and carbon report.

Deadlines for SECR submissions align with annual financial filing timelines — within 9 months of the relevant financial year-end for private companies, and 6 months for public companies.

For any U.S. business with a qualifying UK entity, this means preparing early in the financial year to ensure all necessary energy and emissions data is captured and validated.

What must in-scope companies report for SECR?

For organizations that meet the criteria for SECR, the UK government has outlined specific reporting obligations that must be fulfilled annually. These disclosures, largely focused on energy and carbon information, are designed to provide clarity on a company’s climate impact, drive accountability, and encourage improvements in energy efficiency and sustainability performance.

The required SECR information must be included within the company’s director’s report (for companies) or energy and carbon report (for LLPs) as part of the broader annual report. The reporting must reflect the entity’s business activity and consumption patterns during the financial year.

Core SECR reporting elements include:

  1. Total UK energy use
    Companies must report their underlying global energy use in kilowatt-hours (kWh), split into categories of electricity usage, gas, and transport fuel. These figures must reflect all energy used in the UK — and globally for quoted companies.
  2. Separate energy use categories
    The energy use must be broken down to separate energy sources, allowing stakeholders to see whether emissions are driven more by electricity, heating, or fuel consumption. This level of detail is key to pinpointing energy-saving opportunities.
  3. Associated GHG emissions
    The report must include greenhouse gas emissions expressed in carbon dioxide equivalent (CO₂e), covering Scope 1 (direct emissions from owned or controlled sources) and Scope 2 (indirect emissions from purchased electricity, heat, and steam). Some organizations may also voluntarily include Scope 3 emissions for a more comprehensive view of climate impact.
  4. At least one emissions intensity ratio
    To normalize emissions and enable comparisons, companies are required to report an emissions intensity ratio — such as tonnes of CO₂e per unit of revenue, production volume, or employee.
  5. Energy efficiency actions
    The report must describe any measures taken to improve energy efficiency during the year. This helps stakeholders understand the steps a business is taking to reduce its climate impact and costs.
  6. Methodologies used
    A clear explanation of the methodologies, conversion factors, and data sources used to compile SECR data is required. This ensures transparency and comparability across sectors and years.

How can companies prepare?

Preparation for SECR compliance involves more than ticking regulatory boxes. It’s about integrating sustainability into core operations, building transparency, and driving efficiency. Here’s how U.S. businesses with UK operations can prepare effectively:

1. Assess SECR applicability

Determine whether your UK subsidiaries or legal entities meet the size thresholds that trigger SECR obligations. If you’re unsure, engage with a UK-based compliance advisor to perform an eligibility assessment.

2. Understand the SECR guidelines

Companies must disclose energy use and associated emissions. Specifically, SECR reporting requires:

  • Total energy consumption in kilowatt-hours (kWh), covering electricity, gas, and transport fuels
  • Emissions in CO₂e, typically including Scope 1 and Scope 2 emissions
  • At least one emissions intensity ratio — such as emissions per unit of revenue, floor area, or production output
  • A description of energy efficiency measures undertaken in the reporting year
  • Clear methodologies used for data collection and conversion

Quoted companies must report global energy use and emissions, while unquoted companies and LLPs report UK energy consumption only.

3. Set up strong data systems

Establish processes and systems for capturing SECR data throughout the year. This includes:

  • Installing sub-meters or smart meters in UK facilities
  • Tracking transport fuel consumption
  • Collecting data from utility bills and fleet management systems
  • Assigning responsibility to specific individuals or teams

Using centralized systems also facilitates the aggregation of total energy consumption and ensures completeness.

4. Apply recognized methodologies

Use approved carbon accounting standards to calculate emissions and intensity ratios. Acceptable frameworks include:

  • The Greenhouse Gas Protocol
  • DEFRA’s Environmental Reporting Guidelines
  • ISO 14064

This ensures consistency, especially when comparing emissions intensity ratios across multiple years or business units.

5. Verify your results

While not mandatory, many companies choose to audit or externally assure their SECR submissions to enhance accuracy and build trust with stakeholders. Verification also helps identify inefficiencies and opportunities for improved energy usage.

How can ESG tools help?

Environmental, Social, and Governance (ESG) platforms have become invaluable for companies managing SECR reporting and other sustainability disclosures. For U.S. firms with a presence in the UK, ESG tools help transform regulatory obligations into strategic advantages.

Centralize SECR data

ESG platforms consolidate energy and emissions data across business units and geographies. For U.S. companies, this centralization supports seamless collaboration between headquarters and UK entities, ensuring complete and timely SECR submissions.

Automate calculations and reporting

ESG software simplifies the process of calculating carbon dioxide equivalent emissions and emissions intensity ratios using UK-specific emissions factors. Many tools offer SECR-aligned templates that streamline the production of the annual report.

Stay current with regulations

Built-in regulatory intelligence keeps ESG tools updated with the latest SECR requirements, methodologies, and emissions factors — ensuring that your reporting remains compliant and up to date.

Enhance stakeholder confidence

Integrated ESG platforms allow companies to combine SECR disclosures with broader ESG communications. This unified approach enhances investor and customer confidence by showcasing your commitment to energy efficiency, transparency, and corporate responsibility.

Benchmark and improve

Many ESG platforms offer performance dashboards that benchmark energy usage and emissions over time or against peers. This makes it easier to identify areas for energy efficiency gains and to demonstrate progress in future annual reports.

Final thoughts: SECR as a strategic opportunity

For U.S. companies with UK operations, SECR is more than a compliance exercise. It represents a major step toward aligning with global expectations around sustainability, environmental transparency, and corporate responsibility.

By actively engaging with SECR requirements, American businesses can not only avoid penalties but also identify ways to improve operational efficiency, reduce energy costs, and enhance stakeholder trust.

Incorporating SECR reporting into your broader ESG strategy creates opportunities for value creation — from better risk management to stronger investor relationships.

What to do next

  • Review whether any of your UK entities are subject to SECR
  • Establish data collection systems for energy use and emissions
  • Utilize ESG platforms to support reporting and analysis
  • Integrate SECR disclosures into your overall annual report
  • Align reporting with global sustainability goals and standards

By turning regulatory compliance into a foundation for innovation and accountability, SECR can help U.S. businesses lead in a rapidly evolving global marketplace.

Sweep can help

Sweep is a carbon and ESG management platform that empowers businesses to meet their sustainability goals.

Using our platform, you can:

  • Conduct a thorough assessment of your carbon footprint.
  • Get a real-time overview of your supply chain and ensure that your suppliers meet your sustainability targets.
  • Reach full compliance with the CSRD and other key ESG legislation in a matter of weeks.
  • Ensure your sustainability information is reliable by having it verified by a third party before going public.
See how we can help you on your sustainability journey